Today, many companies face budgetary challenges on a continual basis
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Deliverable Length: |
4-5 pages |
Assignment Description
Today, many companies face budgetary challenges on a continual basis. Two critical aspects that businesses lack are effective control practices and monitoring.You have been asked by your manager of the Money Cares Investment Corporation, to outline problematic or risk areas in the company’s financial procedures. Upon reviewing the budget, you notice that there is overspending in marketing supplies, transportation, and workshop items that include hospitality items such as food and drink for the customers. Each investment specialist is given a company credit card for the above expenses but there are no policies established for monitoring. Money Cares is a small business of 8 employees: CEO, Financier, a manager, 3 investment specialists, and 2 clerical assistants.
For this assignment you must identify possible risks for the Money Cares Investment Corporation. In establishing an investment company, you must answer the following
What could go wrong?
Identify at least 3 possible risks.
What must happen in order for the company to
succeed?
What are the company’s most vulnerable areas?
Identify the company’s assets
Where is the most money spent?
How should the budget activities be regulated?
Please submit your assignment.
Proposed Outline from my Unit 4 Discussion Board
Title Page
Abstract
Main body of document
Introduction to Budget Control and Monitoring (Focus of Budget Control and Monitoring [Multimedia], 2013)
Risks
§ Risk 1
§ Risk 2
§ Risk 3
What needs to happen for organization to succeed
§ This is where I would recommend the control method that would be required by utilizing a checklist, such as what is described in “Proper Budget Control Checklist” found in the MUSE (Career Education Corporation, 2013).
Vulnerable areas
§ This area is where I would be discussing the areas that require examination, for example, the overspending for marketing supplies, transportation, and workshop items
Organizations Assets
§ Because the scenario really doesn’t describe what their assets are, other than the personnel that are employed by this organization, I will have to endeavor to be creative.
Disbursement of funds
§ In this section, I would talk about what has been identified on where the funds are currently being spent.
Budget Activities
§ This section would cover information as to how controls and monitoring will be put into place to oversee the budgetary challenges.
§ Chapter 21 – Budgeting for Cost Management (Budgeting for Cost Management, 2012)
§ Chapter 18 – Financial Modeling(Financial Modeling, 2012)
Conclusion
This is where I will wrap everything up in a summary.
Reference
All research items utilized in this document will be listed in this section
Below is the listing of references I had proposed – however, I did mention that this was subject to change.
References
Career Education Corporation. (2013). Focus of Budget Control and Monitoring [Multimedia]. Retrieved from AIU online: https://mycampus.aiu-online.com/courses/FINA425/ u5/hub1/hub.html
Career Education Corporation. (2013). Proper Budget Control Checklist [Multimedia]. Retrieved from AIU online: https://mycampus.aiu-online.com/courses/FINA425/u5/hub1/hub.html
Shim, J. K., Siegel, J. G., & Shim, A. I. (2012). Budgeting for Cost Management. In Budgeting Basics and Beyond (pp. 393-409). Hoboken, New Jersey: John Wiley & Sons, Inc. Retrieved from http://wow.coursesmart.com
Shim, J. K., Siegel, J. G., & Shim, A. I. (2012). Financial Modeling. In Budgeting Basics and Beyond (pp. 315-328). Hoboken, New Jersey: John Wiley & Sons, Inc. Retrieved from http://wow. coursesmart.com
Focus of Budget Control and Monitoring
The focus of budget control and monitoring is not only to keep spending within the budget but also to save money when possible. In an attempt to save money, managers will compare prices on similar goods and services and spend as little as possible to create a small amount of surplus monthly. The idea is to choose the best price but not to sacrifice the levels of quality and service.
Budget monitoring should be a regular activity of the department heads and financial managers. Meetings should be held at regular monthly intervals, and all action times should be identified and formally documented.
Budgetary control should be at the heart of most managers' jobs. The ability to control a budget is important in measuring performance and can aid in promotion. A series of skills are needed when controlling budgets:
Gathering
and using the right information
Establishing
early detection and warning systems
Making
decisions and monitoring results
Course Material Reference Information
Career Education Corporation. (2013). Focus of Budget Control and Monitoring [Multimedia]. Retrieved from AIU online: https://mycampus.aiu-online.com/courses/FINA425/ u5/hub1/hub.html
Proper Budget Control Checklist
A basic checklist for managers to ensure proper control should include the following tasks ("Controlling a budget," 2001):
Understand
the overall budget: line items, amounts, bottom line, etc.
Request
and review budget reports monthly
Communicate
with accounts department regularly (ask questions, assess data, etc.)
Establish
and follow a monitoring and early detection system for the company at
appropriate times (weekly, monthly or quarterly)
Identify
and assess variances and problem areas.
Revise
the budget as necessary offering corrective measures. Be transparent and share
with the appropriate staff.
Reference
Controlling a budget. (2001).Annual, Retrieved fromhttp://www.entrepreneur.com/tradejournals/article/100012296.html
Course Material Reference Information
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